Gray Revises Hoak Buy, Gets Partial FCC OK

Gray Television has received FCC approval to acquire six full-power TV stations and one low-power station (along with five satellite stations) in six markets from Hoak Media, the publicly traded Gray announced last night.

The company said it expects to close on the stations this quarter.

However, because of the agency crackdown on joint sales and sharing agreements, other parts of the complex deal involving sidecar companies have been modified and are still under agency review, it said.

Until the crackdown, which culminated with the adoption of stricter rules on Monday, broadcasters had been setting up sidecar companies to acquire the licenses of stations in markets where the FCC local ownership rules say they may not own them outright. Then, they used financial ties and JSAs and SSAs to operate and control the sidecars to varying degrees.

Last November, Gray announced that it and sidecar Excalibur Broadcasting would acquire all the stations of Hoak and its sidecar Parker Broadcasting for $335 million.

In a totally separate deal, Gray said Excalibur would buy the Fox affiliate (and its satellite) in Minot, N.D., from Prime Cities Broadcasting for $7.2 million.

In an effort to comply with the FCC local ownership rules as they were then understood, Gray said it would spin off the Hoak stations in Panama City, Fla., and Grand Junction, Colo., and Excalibur would spin off a Parker station in Grand Junction.

A month later, Gray said Nexstar and its sidecar Mission had agreed to buy the Panama City and Grand Junction stations for $33.5 million.

In light of the FCC’s new policy for handling JSAs and sidecars, Gray said it has restructured its relationship with Excalibur to put more financial distance between them.

“The changes included removing Gray’s guarantee of Excalibur’s financing to acquire Excalibur’s new stations and eliminating a put/call option on Excalibur’s new stations,” Gray said.

Nexstar and Mission Broadcasting also filed amendments to restructure their transaction involving the Grand Junction stations, Gray said, adding that it couldn’t say when the FCC might act on them.

In addition, Excalibur withdrew its application to acquire the Prime Cities station in Minot.

The FCC has approved Gray’s acquisition of the following Hoak stations.

The FCC is still reviewing Excalibur’s amended applications to acquire the following stations from Hoak and Parker.

Gray also provided updates on two other deals.

The FCC approved and Gray closed on its acquisition of CW affiliates WQCW-WOCW-LP Charleston-Huntington, W.Va., from Lockwood Broadcast Group. Gray also owns the market’s NBC affiliate, WSAZ.

The FCC approved Gray’s acquisition of Fox affils KEVN-KIVV Rapid City, N.D., from Mission TV, which is unrelated to Nexstar’s Mission Broadcasting. Gray anticipates closing the deal this quarter.